Orange juice rises on signs of increased demand

COFFEE

General Comments: Futures were mixed, with Sao Paulo lower on some speculative selling tied to ideas of increasing offers out of Brazil, but New York and London with only minimal changes at the close.  Prices in general have been weak as traders anticipate another big crop out of Brazil starting the Summer, and bears note that improved rains should help increase Vietnamese production potential this year.  Ideas are that supplies are good for now and can only increase down the road.  Rains continue in Vietnam and crop conditions have improved.  Current crop development is still good this year in Brazil, but it has been dry for the past week.  Production ideas remain big there.  Central American crops are mostly harvested and the area is too dry for good new crop flowering.  Colombia is reported to have good conditions.  Many in the business are looking for a bottom to form in this area, and are somewhat surprised at the current price weakness despite the big production ideas from Brazil.

Overnight News:  Certified stocks are lower today and are about 2.743 million bags.  ICE delivery notices are 0 contracts today and now total 137 contracts for the month.  The ICO composite price is now 126.42 ct/lb.  Brazil should get mostly dry conditions.  Temperatures will average near to above normal.  Colombia should get scattered showers, and Central America and Mexico should get mostly dry conditions.  Temperatures should average near to above normal.

Chart Trends:  Trends in New York are down with objectives of 126.00 and 116.00 July.  Support is at 131.00, 128.00, and 125.00 July, and resistance is at 138.00, 140.00, and 142.00 July.  Trends in London are down with objectives of 1950 July.  Support is at 1970, 1955, and 1925 July, and resistance is at 2025, 2035, and 2050 July.  Trends in Sao Paulo are down with objectives of 161 September.  Support is at 160.00, 157.00, and 154.00 September, and resistance is at 163.00, 166.00, and 167.50 September.

SUGAR        

General Comments:  Futures closed lower as traders expect big offers from Brazil.  News of strong production potential from Unica in Brazil kept the selling pressure on.  Traders remain bearish on supplies, especially from Brazil, and this has hurt New York prices.  However, London prices are holding better than those in New York for now.  Traders are keeping an eye on developments in Brazil and expect big production as the harvest moves forward.  Brazil mills could concentrate on Ethanol production first and Sugar production second, and that could create some short term shortages for the market.  Chart patterns are mixed for the short term. 

Overnight News: Mostly dry conditions are expected in Brazil.  Temperatures should average near to above normal. 

Chart Trends: Trends in New York are mixed to down with objectives of 1725 and 1610 July.  Support is at 1725, 1710, and 1680 July, and resistance is at 1760, 1780, and 1800 July.  Trends in London are mixed to down with objectives of 486.00 and 481.00 August.  Support is at 497.00, 496.00, and 494.00 August, and resistance is at 502.00, 508.00, and 513.00 August.

COCOA         

General Comments:  Futures closed lower on what appeared to be speculative long liquidation after the bulls could not force new highs for the move.  Chart patterns suggest further rallies could be coming down the road and fundamentals could support the charts as demand has been better than trade expectations.  The flow of Cocoa from western Africa is down for seasonal considerations, and traders wonder about the quality and size of the mid-crop after some hot and dry weather during the growing season.  Ideas are that production in West Africa could be less next crop year as well despite the improved weather as farmers have not liked offered prices.  The mid-crop harvest is underway, and less than expected production along with smaller beans is reported.  Malaysia and Indonesia crops appear to be in good condition and weather is called favorable.

Overnight News:  Scattered showers are expected in West Africa.  Temperatures will average near to above normal.  Malaysia and Indonesia should see episodes of isolated showers.  Temperatures should average near normal.  Brazil will get mostly dry conditions and warm temperatures.  ICE certified stocks are lower today at 4.701 million bags. ICE said 1 delivery notice was posted against May contracts today and that total deliveries are now 728 contracts.

Chart Trends:  Trends in New York are up with objectives of 2370 and 2530 July.  Support is at 2335, 2295, and 2275 July, with resistance at 2385, 2400, and 2435 July.  Trends in London are mixed to up with objectives of 1580 and 1670 July.  Support is at 1535, 1525, and 1490 July, with resistance at 1570, 1590, and 1610 July.

<< Page 2 of 2
About the Author
Jack Scoville

Jack Scoville is a veteran futures market analyst specializing in grains, softs, rice, oilseeds, and tropical products such as coffee and sugar. His industry contacts in South America, Europe, Asia, and North America provide him with a unique and comprehensive view of these markets. Jack began working in the futures industry over 30 years ago and spent 10 years working on the floor of the Chicago Board of Trade in various roles, starting with The PRICE Futures Group since it was established in 1988. Jack writes daily commentaries - Morning Grains and Softs, in both English and Spanish and is regularly quoted around the world by news & wire services including Dow Jones, AP, Bloomberg, and Reuters. You can contact Jack by phone at (312) 264-4322 or by email at jscoville@pricegroup.com. Learn even more on our website at www.pricegroup.com.

Futures and options trading involves substantial risk of loss and may not be suitable for everyone. The information presented by The PRICE Futures Group is from sources believed to be reliable and all information reported is subject to change without notice.

Comments
comments powered by Disqus